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Our technical startup - overlooking public finance - must have non-profit badge to claim neutrality and attract community. What is the financial and business aspect?
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The only differences between a non-profit and a for-profit company is how the profits are distributed and who owns the company. In a non-profit, all profit is fed back into the organization to further the mission of the organization. Also, no one owns the non-profit. It sole purpose is to fulfill it's mission. So, when the non-profit folds, it's assets will be transferred to another non-profit. A non-profit can have other sources of revenues (e.g. sell Girl Scout Cookies) besides donations. You can pay yourselves pretty much the market rate for your services although that can be tricky, depending on how much money the non-profit has. I know of no investor in a non-profit since you can't own a non-profit and there would be no exit -- thus no point in investing. I also don't know of a startup incubator for non-profits. You may want to have a for-profit business that has a non-profit foundation that does the audit work or whatever. That would be the only way to actually attract investment rather than donations. |
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